Bills for UA project questioned

The city will conduct an “internal review” of payments to the University of Arizona for the UA’s planned Science Center complex downtown, Tucson City Manager Mike Hein said Thursday.

Hein said the review was prompted in part by political pressure from the state Legislature, which has threatened to revoke the tax-increment financing district Tucson has relied on to fund downtown and Rio Nuevo redevelopment.

But some city accountants have been questioning the UA’s invoices for months. In October, Rio Nuevo Finance Manager Stacie Bird asked Hein to sign a memo that said Hein approved “expenditures the City does not allow on other District projects.” If he didn’t sign, she wanted a meeting with him and UA officials to talk about the spending.

Hein signed it.

Then on Jan. 29, Tucson Finance Director Frank Abeyta ordered an audit of city payments to the UA and of the outstanding bills for the Science Center, Rio Nuevo’s flagship project.

Hein, through Bird and Assistant to the City Manager Jaret Barr, put a stop to the audit that day, saying it wasn’t the city’s role to question UA’s expenditures.

On Jan. 30, Abeyta ordered Bird to stop all payments to the UA, then abruptly quit. He had been head of the city’s finance department for only four months.

Neither Abeyta nor city officials will say whether the dispute over the audit was the reason for Abeyta’s resignation, but Abeyta, in an exchange of e-mails with Bird Jan. 29, questioned the appropriateness of some UA bills.

In an interview Thursday, Hein cited staffing concerns, the cooperative ideals of public partnerships and the terms of the contract between the city and UA as reasons for resisting an audit and for paying the full amount billed by the university.

He said the city is bound to pay its share of project expenses even though invoices show spending that the city and the Rio Nuevo district normally wouldn’t cover.

But last week members of a state legislative committee criticized Rio Nuevo’s lack of transparency and money management and also complained about a lack of tangible results.

The UA’s bills may not help the Rio Nuevo projects’ reputation with legislators.

The charges Bird labeled “questionable” included $161,585 for salaries, $2,155 for food, $14,374 for new computers and a $2,289 trip to Pisa, Italy. The items in doubt accounted for more than $186,000 of the $692,000 the university spent on the project in June and July.

The most recent invoices reviewed by the Tucson Citizen show that spending patterns haven’t changed much, and documents supporting much of the billed amounts were missing.

Receipts lumped with the January invoice show another trip to Pisa, costing $1,188 in June, and requests for reimbursement for a $3,927 trip for two to attend a planetarium conference in Chicago and $1,784 for a university employee to learn about data mining and information storage at a resort near Las Vegas.

The slips showed meals for two in June and July in Tucson at Sullivan’s Steakhouse ($127.98), Barrio Food & Drink ($73.51) and the Arizona Inn ($49.92), and a $165 charge from a HoneyBaked Ham Store that included a $30 delivery fee.

Abeyta wrote in an e-mail sent to Bird at 7:54 a.m. the day he resigned that “The City Manager said he would rather not know what discrepancies we find in the payments to U of A. . . . Also he indicated what you said, that as long as U of A approves the expenditures, we don’t have to. I obviously don’t agree with that.”

Abeyta said he was concerned that unless the project was slowed, the city would be spending money on the Science Center that had been allocated to other projects. “Since we have only $2 million from this bond issue, someone has to slow this project down,” he wrote.

The UA has billed the city for about $1.3 million of the $2 million Rio Nuevo bond allocation already. The city has not paid the university any of that amount.

Bird, who reports directly to Hein but earlier also to Abeyta in his role as Rio Nuevo treasurer, said Thursday the delay in payments was because of work on the city’s sale of $80 million in Rio Nuevo bonds, not questions about the UA’s spending.

The city has agreed to pay half the cost of the Science Center, up to $130 million. The UA has spent and approved more than $13.3 million so far, according to its expenditure summary.

The contract states that Tucson must reimburse the university for “one-half of the total design phase amounts expended to date at the end of the month.” There is no clause clarifying procurement policies.

The contract does, however, give the UA an out if its funding is cut by legislators, allowing it to renegotiate terms or cancel the deal.

University of Arizona President Robert N. Shelton said Saturday that the UA Vice President of Business Affairs Joel Valdez and Hein have been discussing a revised construction plan for budgetary reasons.

Councilwoman Nina Trasoff, who presides over the Rio Nuevo council subcommittee and whose ward covers much of the Rio Nuevo district, said Thursday, “This has been very difficult. . . . We are bound by the terms of the agreement.”

Councilwoman Karin Uhlich, who called for a city audit commission in June after a dispute with Hein and questions over budget figures, said a review of the UA Science Center invoices could be the commission’s first work.

“It’s true that we have to watch all costs at this time, but transparency and accountability remain priorities,” Uhlich wrote in a statement. “Mayor and Council amended the outside auditing firm contract to allow for ‘spot audits’ costing less than $50,000. That may be a way to contain the cost of any review needed.”

The UA’s Valdez, a former Tucson city manager, declined to comment on specifics of the university’s spending Thursday. He did say, however, that “I’m not opposed to an audit.”

Bills for proposed UA Science Center questioned

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